Growth Exceeds Estimates as U.S. Weathers Budget Cuts: Economy
Source: Bloomberg
By Shobhana Chandra - Aug 29, 2013
The U.S. economy expanded more than estimated in the second quarter, providing evidence that growth is picking up as the nation overcomes the effects of federal tax increases and budget cuts.
Gross domestic product rose at a 2.5 percent annualized rate, up from an initial estimate of 1.7 percent, Commerce Department figures showed today in Washington. The median forecast of 79 economists surveyed by Bloomberg projected a 2.2 percent gain. Other reports today showed claims for unemployment benefits dropped and consumer confidence weakened.
The improvement in growth shows the world’s largest economy gaining momentum after a drought, Superstorm Sandy and budget battles in Washington stalled growth in the last three months of 2012. Recent data have shown the labor market is gaining strength while home prices rise, bolstering household finances.
“The economy is doing fine,” said Brian Jones, a senior U.S. economist at Societe Generale in New York, who correctly projected the gain in GDP. “It is going to weather the sequestration. Growth will accelerate in the second half.”
Read more: http://www.bloomberg.com/news/2013-08-29/economy-in-u-s-expanded-more-than-forecast-in-second-quarter.html
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